by Robert Yota
Publicly-listed property company PT Surya Semesta Internusa (SSIA) booked a positive performance during the first quarter of this year. The company recorded net sales of Rp 882 billion, up 7% from Rp 823.7 billion in 1Q-2019. SSIA’s construction sector was the highest sales contributor with Rp 652.1 billion or 73.9% of total revenue. Meanwhile, the company’s hospitality contributed Rp 142.9 billion or 16% of SSIA’s revenues, while the property segment (industrial estate, real estate, and rental property) posted Rp 86.9 billion, or 9.8% of the company’s revenues.
In its recent release, SSIA reported the revenue growth in 1Q was mainly driven by the revenue increase in the property and construction segments, which grew 20% and 11.8% year-on-year respectively. On the other hand, SSIA’s hospitality sector decreased by approximately 16% due to lower occupancy rates in February and March, as the coronavirus start spreading.
Despite the encouraging revenue figures, SSIA did experience a further drop in its net income as the company suffered a net loss of Rp 17.4 billion in 1Q-2020 as opposed to a net loss of Rp 10.9 billion in last year’s first quarter. The company experienced a further net loss due to an increase in interest expense by 23.7% from Rp 38 billion in 2019 1Q to Rp 47 billion in this year’s first quarter, according to the press release.
Last month, Pefindo Credit Rating Agency had affirmed SSIA’s A- corporate rating and also revised the outlook on the ratings from stable to negative. According to the agency, the change in outlook is due to the COVID-19 outbreak, which has significantly affected SSIA’s hotel operations. “We expect the Melia Bali Hotel and Grand Melia Jakarta, SSIA’s two largest hotel revenue contributors, to generate near-zero revenue due to travel and visa restrictions in response to the pandemic,” states Pefindo in a report.
The Grand Melia Jakarta is temporarily closed following large-scale social restrictions (PSBB) while Melia Bali Hotel will not accept new bookings until June. In 1Q-2020, hotels accounted for approximately 16% of SSIA’s total revenue, which is a drop as opposed to the 21% average in 2017-2019.
Moving forward, the company aims to book 80 hectares of land sales of real estate assets upon the phase 4 completion of estate projects in Suryacipta City of Industry and Karawang, West Java in 3Q-2020. However, SSIA also expects its revenue to be lower by 13% at the end of this year.